Laxey Partners quits Shaftesbury days after backing cash call

Laxey Partners, the hedge fund, has offloaded its 19pc stake in Shaftesbury
less than a week after backing the property group's £150m rights issue.

By Peter Taylor

4:23PM BST 11 Jun 2009

JP Morgan Cazenove on Thursday placed Laxey's stake in Shaftesbury at 282p a share, a discount of almost 9pc on Wednesday's closing price. The sale price valued the stake at £119m.

Shaftesbury

Shaftesbury shares dropped sharply when trading opened, falling to 284p, on news that the hedge fund was poised to sell its stake of 25.7m shares and 17.2m nil-paid rights.

But they recovered midway through the morning as, according analysts, investors accepted that Laxey had no concerns about the performance of Shaftesbury.

Mike Prew, an analyst with Nomura, said it was "always a mystery as to what anyone could find to be 'activist' about" in Shaftsbury, which he said was a high-quality real estate investment trust.

Shaftesbury invests exclusively in West End properties, mostly in the retail sector, and has embarked on the £150m capital raising to take advantage of opportunities in an "unsettled" property market.

While supportive of the rights issue, Laxey is believed to have been reluctant to devote more capital to the company.

Michael Burt, an analyst at Noble, said the hedge fund was likely to use proceeds from the placing to pursue more opportunities in the Aim market after making an approach for Aim-listed Italian property group Spazio Investments.

Mr Prew added: "It looks like the rights issue has not only given Shaftesbury shopping money but diluted Laxey off its share register, which should be higher quality as a result".